Prognosis for change

Marvin O’Quinn asks a simple question: “How are you able to make your budget balance when half a billion dollars each year of care is not being paid back?”

As CEO of Jackson Memorial Health System, O’Quinn is tasked with finding the solution to that query and to other issues facing the 90-year-old hospital system.

“That’s been a big hurdle for us,” says O’Quinn, who joined the organization in 2003 as both CEO of the health system and as president of the Public Health Trust, an independent body that oversees the system’s primary facility: Jackson Memorial Hospital.

The real issue for O’Quinn and the health system went well beyond money; it went to the culture the organization lived every day.

“The board believed the future success depended upon the organization balancing its charity care obligations with bringing in more patients who have an ability to pay,” O’Quinn says. “That involved a different orientation for the organization than it had in the past.”

Everyone had to start thinking differently. No longer could each facility within the system work semi-independently of the others. Instead, everyone had to be working toward a common set of goals and one vision.

Change started when O’Quinn rewrote the organization’s vision and mission statements and created a balanced scorecard to measure its progress.

“It’s nothing new; it’s used throughout industry,” says O’Quinn. “That scorecard has what our vision is  to be a great academic medical center  and what our mission is  to provide a single standard of care for all who come into our institution.”

Through a series of meetings with both management and the board, O’Quinn developed six pillars that serve as the foundation for the new mission and vision  access to the institution, operational efficiency, quality of care, a good teaching relationship with the University of Miami, financial management and community service.

“If we’re going to achieve our mission and vision, we have to be successful in each of those six areas,” says O’Quinn.

Like any large organization that has been headed in one direction for a long time, change is not easy.

“How do you keep in contact and get 10,500 employees all moving in the same direction when they’ve never been asked to do that before, or they’ve been asked in the past to move in a different direction?” O’Quinn says. “That’s been a big obstacle for us that we’re still working on and will be working on for years to come. There are a lot of people in the organization who believe the old way was the better way.”

But if Jackson Memorial Health System is going to succeed, the new ways have to be embraced by all.

“Be very disciplined about the goal-setting process,” he says. “Make sure you tie rewards to performance.”

Managers cannot simply state the goal and move on. They must also provide guidance and make those goals relevant to the ones who must implement them.

“We built it into our evaluation process,” O’Quinn says. “Performance evaluations are built around (the pillars). When people set up their goals each year, they have to use the them as the framework for their goals. It cascades down through the organization  goal-setting matrices where each person in the organization looks up and says, ‘How much of my goals relate directly to what the system is trying to get accomplished, or what is it in the system’s goals that relates directly to what it is I have to do in order for the system to achieve its goals?’”

CommunicationSuccessfully transforming a culture takes continuous work. And ensuring that people are embracing the message takes continuous communication.

“Particularly in this environment, it works better if you can get people to move in a certain direction because they think it’s the right thing to do. They really want to go there and they really want to help you do it, as opposed to doing it because they’re afraid of you. I don’t like to have fear in an organization. That’s not very productive.”

There is no way to get that change in attitude without providing employees with the right information, and it is a constant challenge.

“You have to work with masses of people throughout the organization to make change happen,” O’Quinn says. “What we’ve been doing here is communicating very strongly to all of our employees, starting with what’s our vision, what’s our mission, what are our goals and objectives and how we are measuring them to help move the organization forward.

“In a big organization, communication is difficult and often messy. I have town hall meetings once a quarter. We presented (the scorecard) at our town hall meetings. We built the meetings around the scorecard. I asked each of the executives to review it with their subordinates and, in turn, review it with their subordinates so it would go down through the organization.”

O’Quinn doesn’t just hold employees accountable for maintaining the pillars. He holds himself and other executives accountable, as well.

“We evaluate our own performance,” O’Quinn says. “The board evaluates me. I evaluate the executives. The executives evaluate their direct reports based on the progress that we make in those six pillars. That’s how we keep focused on what we’re trying to accomplish.

“We do the same thing for the board. Twice a year, the board has a retreat where they evaluate their performance and they also evaluate me. They also talk about where the organization is going, are we governing correctly, and what do we need to differently. In certain parts of the organization, you can see it on bulletin boards. We sent it out to the organization and we have meetings around it. Each year, we give a report to a board on it. We’re going to step that up to quarterly reports.”

Truly changing the culture, though, takes more than a few meetings. Even executives need constant reminders.

“We have quarterly retreats with the senior management team and the next level down, which we call the leadership development group,” O’Quinn says. “Those retreats are built around educational and leadership goals as well as galvanizing speeches and discussions to get people focused in the same direction.”

Smaller targetsTo be of any value, the pillars must influence behavior within the health system’s 12 primary care centers, two long-term care nursing facilities, a community hospital, a community diagnostic center, nine school-based programs, seven clinics in the county’s corrections facilities and Jackson Memorial Hospital itself. And reinventing the company’s culture is an enormous task that will take a long time to complete.

The key, O’Quinn says, is not to look at the end result but to tackle a number of more attainable goals along the way.

“I believe that what gets measured gets done,” he says. “The scorecard focuses leadership on the key strategic areas necessary for the success of the organization.”

For example, to deal with the charity care budget issues, O’Quinn didn’t focus on a single goal of compensating for $500 million in write-offs but instead focused on a monthly cash collection goal to exceed $63 million.

“We’ve set out goals in each of those areas that we measure monthly to see that we’re moving in the right direction,” O’Quinn says. “On the financial measures, they are very quantitative and they are easy to track. The way we have been tracking them is simply to compare them to the targeted goals.”

Because any given month may be an aberration, O’Quinn set up a number of parameters for many of the goals.

“We don’t get excited when we see random variations,” he says. “As long as the quantitative number is within certain limits, then it’s acceptable. Once it gets outside those limits, then we get excited about it.”

And although they may be more of a challenge, O’Quinn says even concrete targets, such as quality of care and the system’s relationship with its teaching partner, the University of Miami, must be tracked.

“For the qualitative goals that are more process oriented, we’re going to be setting up Gantt charts,” a horizontal bar chart that tracks a project’s progress in relation to time,” O’Quinn says. “In the past, it’s been either did you do it or didn’t you do it,” says O’Quinn. “Gantt charts will show, in order for me to get this qualitative goal done, eight things have to happen by a given date.

“We’ll be able to track on a monthly basis progress toward the goal so we don’t end up at the end of the year saying, ‘Did you get this goal done or didn’t you?’ and the answer is no and we’re just now finding out about it. We’re doing that for the more qualitative goals.”

For the quality of care pillar, for example, the system’s target is to have at least 75 percent of surveyed patients say they’d be willing to recommend the hospital to another. Other quality goals include striving for the 90th percentile on key measures reported to the federal government.

O’Quinn’s mission to change the culture of an organization will only work if employees trust and respect management. To make that happen, they work hard to understand what employees are thinking.

Employees are surveyed once a year and the results are compared to internal targets. When the numbers drop below acceptable levels, management responds.

“When they don’t match, we set up work teams to work on the issues,” O’Quinn says. “We manage by exception. There are so many things we could be doing, we focus on the areas that are not hitting the targets.”

One current area of emphasis is nursing satisfaction in the workplace.

“What we’ve been working on there is developing a unit-based nursing council to give the nurses more control over their immediate workspace and environment,” O’Quinn says. “They can make more decisions at the local level, which will improve their satisfaction with their job. That came out of a survey we did last year.”

O’Quinn says that while the process of cultural change throughout the health system began two years ago, there is still a long way to go for the organization that last year had a budget of more than $1 billion.

“You don’t change an organization in three years,” O’Quinn says. “It’s a journey, and to use an outmoded metaphor, it’s a marathon, it’s not a sprint. You change incrementally over time. Some people would say it’s a five- to 10-year process for real cultural change in any organization.

“First we start off with, ‘Why do we exist? What are we trying to become, and what does it take to get there?’ That’s how you begin the cultural change.”

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